HOTELS, guesthouses and tour operators have won a reprieve of seven months from GST.

Treasury Minister Terry Le Sueur has agreed in principle to zero-rate all hotel and guesthouse accommodation costs until 1 January 2009 – seven months after the 3% tax is expected to be levied from the start of May. Neither the Jersey Hospitality Association, which represents hotels and guesthouses which lobbied for the deal, nor the Treasury department announced the deal when it was struck. But the exemption has appeared in he GST regulations published this week. The JHA had argued that they should be given special treatment because hotels agree contracts with tour operators a year ahead. Because of that, for one year the package operators would be offering hotel nights without the 3% GST while the hotels would have had to charge it to customers who booked direct. It is not yet clear how much the exemption will cost the taxman.